Viacom replays copyright claims in YouTube appeal

SAN FRANCISCO (AP) -- Viacom Inc. is seeking
to overturn a court decision that dismissed its claims of copyright
abuse against YouTube even though the Internet video site used to
show thousands of pirated clips.

The challenge filed Friday in a federal
appeals court in New York had been expected since a June ruling
rebuffed Viacom's copyright infringement lawsuit against YouTube
and its owner, Google Inc.

Viacom's renewed effort to collect more than
$1 billon in alleged damages from Google is the latest twist in a
closely watched legal battle that has already dragged on for nearly
four years. Oral argument on the appeal probably won't happen until
at least next summer.

The case revolves around the premise that
YouTube became the world's leading online video channel after its
2005 inception by turning a blind eye to the rampant piracy on its
site. Viacom argued that YouTube's founders realized the
copyright-protected clips from shows such as Viacom's "The Daily
Show" attracted far more viewers than the amateur video of cute
kittens and angst-ridden teenagers.

Piracy was so prevalent at YouTube in its
early years that Google branded the video-sharing site as "a `rogue
enabler' of content theft" before it bought the service in 2006,
according to internal documents unearthed in the lawsuit.

The unauthorized material stored on YouTube
included tens of thousands of clips from Viacom programs shown on
MTV, Comedy Central and Nickelodeon.

Underscoring its resolve, Viacom hired
well-known attorney Theodore Olson to steer the challenge in the
2nd U.S. Circuit Court of Appeals. He served as U.S. solicitor
general during the first term of President George W. Bush.

"We are appealing a very bad decision, which
would have serious repercussions for our economy and for the
creative works for people who spend time trying to enrich our
lives," Olson said in an interview.

YouTube is confident the lower-court ruling
that cleared the service will be upheld. "We regret that Viacom
continues to drag out this case," spokesman Aaron Zamost said.

Viacom's appeal will hinge on its argument
that YouTube doesn't qualify for the protections allowed under a
12-year-old law that insulates Internet services from copyright
claims as long as they promptly remove illegal content after being
notified of a violation.

U.S. District Judge Louis Stanton concluded
that YouTube had complied with the Digital Millennium Copyright
Act, absolving it of legal liability for the theft of its users. He
dismissed Viacom's lawsuit before a trial.

But Viacom contends YouTube doesn't fall
under the law's "safe harbor" provision because its founders - Chad
Hurley, Steve Chen and Jawed Karim - welcomed the piracy as a way
of expanding its audience and increasing the chances that they
could get rich quick by selling the site to a larger company. The
founders cashed in when Google bought YouTube for $1.76 billion
four years ago.

None of them is still in leadership positions
at YouTube, which now receives about 35 hours of video every
minute. The site relies on technology developed by Google to
identify and block unauthorized content.

Viacom's appeal cites evidence that YouTube
could have done more to prevent pirated clips from appearing on its
site, but held off on imposing tougher controls because the site's
managers knew viewership would plunge without the
copyright-protected material.

Granting YouTube immunity under the 1998
copyright law would be "absurd, disquieting and disruptive," Olson
wrote in Viacom's 61-page appeal.

But Internet service providers and
free-speech groups believe more damage would be done if YouTube
loses its tussle with Viacom. They fear a ruling against YouTube
would undercut the digital copyright act and make it more difficult
for people to express themselves online, because service providers
fearing lawsuits would block controversial, but legal content.

Shares in New York-based Viacom fell 25 cents
to close at $39.80, while shares in Google, which is based in
Mountain View, Calif., gained $1.18 to close at $573.